When you own a commercial property that is currently vacant, one of the biggest concerns is the burden of paying business rates on that empty space. Business rates are a tax on non-domestic properties, including shops, offices, and warehouses. However, there are ways to potentially avoid or reduce these rates while you search for a new tenant or decide what to do with the property. In this article, we will discuss some tips for avoiding business rates on empty property.
1. Apply for Empty Property Relief
One of the most common ways to avoid paying business rates on empty property is to apply for Empty Property Relief. This relief provides some businesses with a 100% exemption from business rates for a set period, usually the first three or six months that a property is empty. After this initial period, the relief may still apply but at a reduced rate, such as a 50% exemption. It is important to check with your local council to see if you are eligible for Empty Property Relief and to apply as soon as possible to take advantage of this benefit.
2. Consider Temporary Use of the Property
Another way to potentially avoid paying full business rates on empty property is to consider temporary uses for the space. For example, you could lease the property for short-term events, pop-up shops, or even storage purposes. By doing so, you may be able to qualify for exemptions or discounts on business rates, depending on the specific circumstances. This temporary use of the property can also help generate some income while you continue to search for a long-term tenant.
3. Explore Small Business Rate Relief
If you are unable to secure Empty Property Relief or find temporary uses for the property, you may still be eligible for Small Business Rate Relief. This relief is available to businesses that occupy only one property with a rateable value below a certain threshold. By registering for Small Business Rate Relief, you may be able to reduce the amount of business rates you are required to pay on the empty property. This can provide some financial relief while you work on finding a new tenant or deciding on the future use of the property.
4. Appeal the Rateable Value
In some cases, the rateable value of a property may be too high, leading to higher business rates. If you believe that the rateable value assigned to your property is inaccurate, you have the right to appeal to the Valuation Office Agency (VOA). By providing evidence to support your case, such as rental data or information on similar properties in the area, you may be able to successfully reduce the rateable value of your property and lower your business rates. It is important to carefully review the rateable value assigned to your property and consider appealing if you believe it is unfair or incorrect.
5. Utilize Property Guardians
Property guardianship is another option to consider when looking to avoid paying full business rates on empty property. Property guardians are individuals or companies that occupy vacant properties on a temporary basis to help protect them from vandalism, squatting, and deterioration. By allowing property guardians to live or work in the empty property, you may be able to qualify for discounts on business rates or even exemptions in some cases. This arrangement can also help maintain the property and prevent it from becoming a target for crime or vandalism.
In conclusion, there are several strategies that can be implemented to avoid or reduce business rates on empty property. By applying for Empty Property Relief, considering temporary uses, exploring Small Business Rate Relief, appealing the rateable value, and utilizing property guardians, you can potentially minimize the financial burden of business rates while you search for a new tenant or determine the future of the property. It is important to carefully evaluate your options and take proactive steps to avoid unnecessary costs associated with owning an empty commercial property.